Former New York Assembly Speaker Sheldon Silver convicted on corruption charges

Case illuminated 'pay to play' political culture partly responsible for New York's D - in State Integrity Investigation

7:05 pm, November 30, 2015Updated: 8:56 am, December 1, 2015

Former New York Assembly Speaker Sheldon Silver arrives to the courthouse in New York on November 30, 2015. Silver, a Manhattan Democrat who led the Assembly for 20 years, was convicted of taking more than $4 million in bribes and kickbacks.

November 9, 2015

Former New York Assembly speaker Sheldon Silver, for decades one of the state’s most powerful political figures, was convicted of corruption charges on Monday, capping a five-week trial that once again put a spotlight on Albany’s toxic political culture. Silver’s fall is the latest confirmation of widespread ethics problems that helped earn the state a D- in the recent State Integrity Investigation.

Silver, 71, was convicted in federal court of seven counts, including extortion and money laundering, involving millions of dollars in kickbacks he received over more than 10 years. Jurors are still hearing testimony in a separate federal case against former Senate President Dean Skelos, who along with his son was charged with several corruption-related counts in May.

“Today, Sheldon Silver got justice, and at long last, so did the people of New York,” said a statement from U.S. Attorney Preet Bharara, who is behind both cases.

Both trials illuminate many of the core issues responsible for New York ranking 31st in the State Integrity Investigation, a data-driven assessment of state government accountability and transparency conducted by the Center for Public Integrity and Global Integrity; the study was released earlier this month. The Empire State earned failing grades in six of 13 categories, including for its budget process and public access to information. New York also received a D- for its campaign finance system, which includes some of the nation’s highest limits on donations to candidates.

Silver’s conviction stems from nearly $4 million in fees he received for referring cases to law firms in two, unrelated schemes. In one, Silver helped direct state grants to a doctor who specialized in mesothelioma, a disease related to asbestos exposure. In exchange, the doctor referred clients to a law firm that shared its fees with Silver. In the other scheme, prosecutors said Silver helped real estate developers win favorable legislation. In exchange, the developers agreed to direct certain tax work through a law firm with ties to Silver, which again sent the lawmaker a portion of its fees.

At its heart, however, the case revolved around the central question of what a “citizen-lawmaker,” serving in a part-time legislature, should be allowed to do. From the beginning, Silver’s lawyer portrayed his client’s actions as not only legal, but a normal part of government work. In his opening argument, defense lawyer Steven Molo described Silver’s behavior as “conduct which is normal, conduct which allows government to function,” arguing that conflicts of interest are an inherent part of a legislature in which lawmakers are allowed to earn private income. Prosecutor Howard Master countered that Silver’s governing style “wasn’t by the people or for the people.” Instead, he said, “It was by Sheldon Silver for Sheldon Silver.”

The trial brought a harsh spotlight to one of the state’s most powerful political players, Glenwood Management Corp., a real estate developer that has showered politicians with money over the past decade. Glenwood, one of the two developers involved in the case, has been a prominent user of the state’s “LLC loophole,” a quirk in campaign finance law that treats limited liability corporations as individuals rather than corporations, allowing them to give far more money than other companies. The loophole essentially allows donors to create an unlimited number of limited liability corporations and give the maximum amount allowed from each. Glenwood has given millions of dollars to candidates this way.

Glenwood and the campaign finance loophole have played a prominent role in the Skelos trial, too, where witnesses have testified about the importance of the loophole to the real estate industry. Skelos and his son are charged with multiple counts of conspiracy, bribery and extortion for allegedly getting Glenwood to direct business to the younger Skelos. Glenwood was not charged in connection with either trial.

As conviction after conviction has befallen New York lawmakers in recent years, Gov. Andrew Cuomo and the legislature have repeatedly pledged to pass stronger ethics reforms. In April, the legislature passed a reform package including a requirement that lawmakers disclose the names of any clients who pay them or their firms $5,000 or more. Other changes included greater disclosure of independent campaign spending and tighter restrictions against spending campaign funds for personal use. But watchdogs criticized the changes as far short of what the state needs, and said loopholes in the law will allow lawmaker-lawyers such as Silver to continue to hide the names of their clients.

A coalition of advocacy groups has been calling for more substantial reforms, including enhanced campaign finance and personal income disclosures and a strengthening of the state’s ethics commission. In the days after the State Integrity Investigation was published, the groups issued a press release calling on lawmakers and the governor to act immediately, using both the state’s D- grade and the Silver and Skelos trials as rallying cries.

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